Porsche chief Matthias Mueller could take over as VW CEO, Berlin's daily Tagesspiegel reports citing sources on the board.

Volkswagen however denied it was going to replace Winterkorn amid an emissions scandal that has rocked the company.

Reeling from emissions scandal

Volkswagen's shares tumbled more than 20% on Monday, its biggest one-day fall yet, as the automaker plunged into turmoil by accusations from US authorities that it falsified emissions data.

The US Environmental Protection Agency said on Friday Europe's biggest automaker used software for diesel VW and Audi branded cars that deceived regulators measuring toxic emissions and could face up to $18-billion in penalties.

VW responds

Andreas Lampersbach, VW's head of corporate and business communications, issued the following: "Volkswagen is working at full speed to clarify irregularities concerning a particular software used in diesel engines."

Volkswagen could face civil penalties of $37 500 for each vehicle not in compliance with federal clean air rules. Some 482 000 four-cylinder VW and Audi diesel cars sold since 2008 are involved in the allegations.

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